A report by the Federation of Small Businesses (FSB) claims that there is a ‘huge opportunity’ to substantially increase the number of small businesses that export goods and services to overseas markets.
The report provides a comprehensive review into how the UK’s small businesses interact with the global export market.
It found that the proportion of small businesses exporting (21%) has remained static for many years, but that this number is now matched by those that would consider exporting (21%).
The FSB claims that this points to a potential to ‘double the number of small business exporters’, and it calls for the Government, the private sector, the finance industry and business associations to ‘focus on providing effective, targeted and tailored support’.
According to the report, the average annual turnover of an exporter (£935,921) was more than double that of a non-exporter (£390,028). However, the most common challenge facing small businesses in exporting is finding customers, followed by marketing their product to overseas customers – and one in five small firms that would consider exporting do not know where to go for support.
For existing exporters, the biggest challenge cited was foreign exchange rates.
Martin McTague, FSB National Policy Director, said: ‘Small businesses that export are more likely to survive, grow and innovate. But in addition to more traditional barriers, such as language and foreign exchange, businesses are having to deal with a rapidly-changing export landscape and the advantages and challenges brought about by e-commerce. Any support must be designed with this in mind and should be able to cater to a wide range of export needs, both for those currently exporting and for those considering doing so.
‘The Government clearly understands the need to promote exporting given the decision in late 2015 to refocus UKTI’s role and make exports a priority across Government departments. Small businesses are well-placed to make a significant contribution to the Government target to increase the value of exports to £1 trillion and support 100,000 new exporters by 2020. But the fact remains, many small businesses aren’t aware of the support available or how to access it.’
Mr McTague also called for ‘clarity on what the UK’s exit from the EU means for business, with particular emphasis on access to the single market and the free movement of people and trade’.
He added: ‘The majority of FSB members export to the single market which provides access to 500 million potential consumers, more than 26 million businesses and is worth around £9 trillion.’